The Self-Serving Scramble for the Developing World

The world’s richest countries insist their involvement in developing nations is prompted by altruism, but this magnanimity rings hollow.

The tiny Pacific nation of Vanuatu is only the latest developing nation to fall victim to a highly disturbing trend: regional economic giants—in this case China and Australia—playing out their personal rivalries on emerging economies’ soil. Wealthier countries like these are engaged in a constant proxy war for influence, coercing poverty-stricken nations around the world to host their military bases and miring them in debt with gargantuan infrastructural projects.

In the latest kerfuffle, Vanuatu—one of the world’s least developed countries—accepted a Chinese loan to build the new wharf it needed to accommodate heavy cargo. Panicked Australian officials argued that Beijing was plotting to take the strategic wharf back via a “debt equity swap,” Some even suggested that the infrastructure project represented a direct military threat to Australia, as Vanuatu sits within striking distance of Australian shores.

Never one to miss out on the hysterics, the U.S. flexed its muscles as well, sending a contingent of Marines to inspect the wharf and planning military exercises nearby—a common American tactic to both irk China and display its might. In an attempt to ratchet down tensions, Vanuatu was forced to take the highly unusual step of divulging the terms of the agreement it had signed with China, while it emphasized that it had the sovereign right to decide what debt to take on.

The hoopla over the new wharf underlines a dangerous pattern of developing nations worldwide being used as pawns in a “great game” by regional hegemons vying for power. Nations like Vanuatu recognize that they are the unwilling backdrop for this influence war: dismissing Australia’s concerns that China had military ambitions on the island, Vanuatu’s Foreign Minister Ralph Regenvanu remarked: “this big power play that’s happening in which China is involved, in which Australia is involved, Vanuatu wants to be no part of it.”

Despite preferring to remain non-aligned, tiny countries like Vanuatu often have no choice but to leverage these rivalries between major powers to secure funding for desperately-needed infrastructure projects. As Vanuatu has learned the hard way, developed nations aren’t likely to offer development aid unless it’s in their own interest. After years of neglect, Vanuatu’s rapprochement with China resulted in a $20mn investment by Chinese telecommunications giant Huawei. In short succession, Australia made a multimillion-dollar commitment to fund telecom regulation and management, and is now drawing up a security treaty with Vanuatu.

Australian Foreign Minister Julie Bishop has even admitted that Australia has developed a strategy of “competing” with China on the development aid front. The competition has clearly already begun, as Australia snatched away a contract to build an undersea telecommunication cable network to the Solomon Islands initially earmarked for Huawei.

The South Pacific is far from the only flashpoint in this escalating scramble for influence. Latin American countries, particularly Panama and Nicaragua, are increasingly caught in the middle between a “generous” China and a U.S. openly advocating a return to its imperialist Monroe Doctrine. China rewarded Panama’s decision to cut diplomatic ties with Taiwan by showering it with cash: one state-backed firm signed a 99-year lease for Panama’s largest port, while other state enterprises plan to develop the 1,200 hectares surrounding the Panama Canal.

Beijing is plying its cash in Nicaragua as well, having resurrected a controversial century-old plan to construct a canal from the Pacific to the Atlantic. While work on the canal has nearly stalled out, the project remains a “sword of Damocles” hanging over the impoverished Nicaraguan landowners who live along the proposed canal’s path and risk having their property appropriated and their livelihoods destroyed.

On the other side, American officials have oscillated between astonishing neglect—Trump has yet to visit Latin America during his presidency—and vicious invectives towards the region, and yet still dare to berate Latin American countries for ceding to China’s “imperialist powers”.

China’s “imperialist powers” are gobbling up the Indian Ocean as well, where it and India are both courting developing nations to host their competing networks of defense and commerce facilities. In some cases, they are fighting in extremely tight quarters, such as a remote region of Sri Lanka where last year, a Chinese state-owned firm took control of the Hambantota port after Sri Lanka was unable to pay off its debt for the virtually unused facility. In response, India began scheming to seize the nearby Hambantota airport, which it clearly only coveted to aggravate China: the $200 million airport has just one daily flight and Sri Lanka has had to deploy troops to clear out wild animals from the terminals.

Understandably unhappy with being exploited as a stage for the two heavyweights, Sri Lankans have organized protests, begging their government to prevent them from becoming “a Chinese colony.” While the EU and the U.S. remain unreliable partners for Sri Lanka, however—they cut off aid almost entirely between 2006 and 2009—the country will likely be forced to go along with China and India’s games.

Nor is Hambantota the only case of global powers squabbling in close quarters. The tiny African country of Djibouti, despite being ruled by a hard-fisted dictator since 1999, sits on a key shipping strait. Thanks to this strategic location, Djibouti is home to an ever-expanding collection of foreign military bases and investment projects. Within a few kilometers of each other, the desperately poor country hosts the only U.S. military installation in Africa and China’s only overseas base, which increasingly resembles a fortress.

Chinese and American posturing in Djibouti ranges from the genuinely concerning—rumors that China intends to take over a key port Djibouti abruptly nationalized in February—to the absurd, such as allegations that China blinded American fighter pilots with lasers.

The world’s richest countries insist that their involvement in these developing nations is prompted by altruism or counterterrorism efforts, but this magnanimity rings hollow. There’s little evidence that their endless competition to build the most military installations, railways and ports furthers anyone’s interests but their own.